Leaving Work Behind
by Ross Douthat
FEB. 8, 2014
IN 1930, in the darkening valley of the Great Depression, John Maynard Keynes wrote an essay on “Economic Possibilities for Our Grandchildren,” which foresaw a much happier future — one of growth, abundance and the steady decline of full-time work. Eventually, he suggested, civilization might settle on a 15-hour workweek, with three hours of daily labor being sufficient “to satisfy the old Adam in most of us.”
Compared with its Depression-era baseline, much of Keynes’s optimistic vision was prophetic. But the universal 15-hour workweek is not exactly with us yet. Instead, a different trend seems to be emerging, in which well-educated professionals — inspired by rising pay and status-obsessed competition — often work longer hours than they did a few decades ago, while poorer Americans, especially poorer men, are increasingly disconnected from the labor force entirely. (That this trend coincides with widening inequality is not coincidental.)
When economists look ahead to the possibilities awaiting our grandchildren, they often see this divide widening even further, as the digital economy delivers rich rewards to certain kinds of highly educated talent, while revolutions in robotics eliminate many of today’s low-skilled, low-wage jobs.
This context is crucial to understanding the debate that erupted last week over Obamacare’s impact on work-force participation. The Congressional Budget Office had always predicted that the new health care law’s mix of direct benefits and indirect incentives would encourage some people to cut their hours or leave their jobs outright. But its latest report revised the estimate substantially upward, predicting that by 2021, the equivalent of 2.3 million full-time workers — most of them low-wage — could disappear from the American economy.
That big number prompted Republicans to recycle their predictions that the health care law would be a “job killer.” As liberals retorted, this is not exactly right: These would be working hours freely given up, not jobs lost in huge Obamacare-induced layoffs. Any health care reform worthy of the name would have some version of this effect: If you weaken the link between insurance and employment, workers will have one less reason to stay at a job they dislike. And it’s easy to envision cases where the ability to reduce one’s working hours would be an unmitigated good — for ailing near-retirees, for parents of young children.
At the same time, though, the design of Obamacare — Medicaid expansion, subsidies for comprehensive rather than catastrophic coverage, and then the way the subsidy disappears if you get a raise or take a higher-paying job — makes the work disincentive much more substantial than it would be under, say, a conservative alternative that offers everyone a flat credit to buy a catastrophic plan.
So the new law’s impact on work will be felt well beyond families juggling jobs and child care. One of the studies used to model the consequences of Obamacare, for instance, found a strong work disincentive while looking at a population of childless, able-bodied, mostly working-class adults — a demographic that’s already becoming more and more detached from steady, paying work.
And this is where liberalism has a very important choice to make. It’s possible to defend Obamacare’s overall goals while also recognizing its potentially perverse effects, and conceding that we should try to minimize the number of low-skilled workers exiting the labor market.
But it’s also possible to argue that as a rich, post-scarcity society, we shouldn’t really care that much about whether the poor choose to work. The important thing is just making sure they have a decent standard of living, full stop, and if they choose Keynesian leisure over a low-paying job, that’s their business.
There are hints of a division within the liberal mind on this issue. Across the left and center-left, there’s agreement that an unequal society requires a thicker social safety net, and that as technological changes undercut low-wage work, government should help those left behind.
But in the Obamacare debate and elsewhere, it’s not always clear whether this larger welfare state is supposed to promote a link between work, security and mobility, or to substitute for work’s gradual decline. On the left, there’s a growing tendency toward both pessimism and utopianism — with doubts about the compatibility of capitalism and democracy, and skepticism about the possibility for true equality of opportunity, feeding a renewed interest in 1970s-era ideas like a universal basic income.
On the conservative side, things are somewhat clearer. There are libertarians who like the basic income idea, but only as a substitute for the existing welfare state, not as a new expansion. Both “rugged individualist” right-wingers and more communitarian conservatives tend to see work as essential to dignity, mobility and social equality, and see its decline as something to be fiercely resisted.
The question is whether tomorrow’s liberals will be our allies in that fight.